A former managing director of investment banking at Credit Suisse who pleaded guilty to hiding more than $100 million in mortgage-backed security losses in 2007, has escaped further jail time, and has been fined after cooperating with prosecutors.

The 44-year old Swiss
bank employee David Higgs admitted guilt in 2012, and agreed to
cooperate in an investigation of other bank officials. That
allowed him to be sentenced to time served, Bloomberg cites the
US Justice Department.

He and another trader both admitted they had been engaged in a
scheme set up by their supervisor, Kareem Serageldin, who was
then the global head of Credit Suisse’s structured credit-trading
unit.

All three were falsifying prices tied to collateralized debt
obligations in order to meet targets and boost year-end bonuses.
The discrepancy was discovered in 2008 by Credit Suisse' internal
auditors, which forced the bank to make a $2.65 billion
write-down on its portfolio of asset-backed securities in its
2007 accounts.

In 2008 all three men were fired.

“The government has concluded that without David’s
assistance, the case against Mr. Serageldin would have never been
brought, and the mastermind of a serious fraud scheme would have
certainly escaped punishment,” Bloomberg quotes Higgs’s
lawyer, Aaron Goldberg.

The court admitted Higgs’ actions helped create public panic when
the housing bubble burst. However “early, full and
honest” cooperation with prosecutors allowed the banker to
receive a “rare” level of praise, having escaped with a
$50,000 fine.

The judge also said she would sign a $900,000 forfeiture order
against Higgs, which according to his lawyer exceeds the amount
earned as a result of the scheme.

Kareem Serageldin also pleaded guilty in April 2013 and was
sentenced to two and a half years for his involvement in the
fraud. The court ordered him to pay a $150,000 fine as well as
perform community service for two years after his release.